Reported by Timour Azhari and Maya Gebeily
DAMASCUS (Reuters) – Qatar has put a pause on providing financial assistance to Syria’s new leadership for increasing public sector wages, citing concerns about potential violations of U.S. sanctions, according to four sources. This setback hinders efforts to revive the economy in a country torn apart by war.
The delay in Qatar’s support for the wage hike, which was initially reported by Reuters in January, highlights the significant obstacles facing Syria’s new Islamist authorities as they strive to stabilize the divided nation and gain international confidence in their governance.
Despite the U.S. government granting a sanctions waiver on January 6 to permit transactions with Syria’s governing bodies for six months, Qatar is hesitant to proceed with payments through the central bank to fund the salary raise, as the waiver may not cover the necessary transactions, as per the sources.
Three sources indicated that Qatar, a wealthy ally of the U.S. with ties to groups involved in the removal of former Syrian president Bashar al-Assad in December, is awaiting clarity on President Donald Trump’s stance towards Damascus.
The new leadership in Syria, composed of Islamists who formerly had connections to al Qaeda before severing ties in 2016, announced plans to raise wages for many public sector employees by 400% starting in February, at an estimated monthly cost of 1.65 trillion Syrian pounds ($130 million). Regional aid was cited as a potential funding source for this increase.
The salary increase has yet to be implemented, and the exact amount that Qatar intends to contribute remains undisclosed.
Qatar’s Ministry of Foreign Affairs and a spokesperson from the Syrian finance ministry did not provide an immediate response to Reuters’ request for comments. Similarly, the U.S. State Department, Treasury, and White House did not offer any feedback to the questions posed by Reuters.
One source, a U.S. official, revealed that Qatar has refrained from making salary payments due to uncertainties surrounding U.S. sanctions. Another source confirmed that Qatar has not yet disbursed public sector salaries but mentioned that Qatar had dispatched two shipments of liquefied petroleum gas to alleviate the energy crisis in Syria.
Revitalizing the economy is a key objective for Sharaa, the current leader of Syria. According to the United Nations, nine out of ten Syrians are living in poverty.
Sharaa’s administration has laid out plans to reduce a third of jobs in the extensive public sector, which was perceived under Assad’s rule as a method to secure loyalty through wage payments.
The U.S. sanctions waiver, valid until July 7, allows for the transfer of personal remittances via the Central Bank and certain energy transactions. Termed as a general license, this move aimed to facilitate the flow of humanitarian aid. However, the U.S. Treasury clarified that the waiver did not lift the sanctions.
Sharaa has consistently called for the removal of Western sanctions, imposed to isolate
The U.S. administration has provided limited information on its Syria policy. U.S. Secretary of State Marco Rubio, while in Jerusalem on February 16, adopted a cautious stance, emphasizing that although the fall of Assad appeared promising, it would not be beneficial if Syria merely traded one destabilizing entity for another. The complexity of Western policy in Syria is exacerbated by the origins of Sharaa’s Hayat Tahrir al-Sham (HTS), the armed group responsible for overthrowing Assad and deemed a terrorist organization by major world powers. HTS evolved from the Nusra Front, an al Qaeda affiliate in Syria until Sharaa severed ties in 2016. HTS was officially disbanded in January. (This report includes contributions from Andrew Mills in Doha and Andrea Shalal and Daphne Psaledakis in Washington; written by Tom Perry; edited by Daniel Flynn)
